Finance
S&P calls UK borrowing cost jump a "concern", but no immediate hit to rating
Published by Global Banking & Finance Review®
Posted on January 17, 2025
1 min readLast updated: January 27, 2026
Quick Summary
S&P Global notes UK's borrowing cost rise as a concern but maintains the AA credit rating, citing manageable fiscal constraints.
S&P Sees UK Borrowing Cost Rise as a Concern, No Rating Change
LONDON (Reuters) - S&P Global called the recent jump in Britain's bond market borrowing costs a "concern" on Friday, though said it wasn't severe enough yet to have an immediate impact on the country's AA credit rating.
S&P, which has a 'stable' outlook on its UK rating, said though the fiscal position was "constrained", it remained "manageable and the recent rise in cost of financing does not have immediate implications on our sovereign ratings".
"The degree of volatility in interest expenditure for the UK is a concern", however, it added, highlighting that a 100 basis point rise in the cost of new financing increases the cost of interest payments for the government by 0.4-0.5 percentage points of GDP over a 12-month period.
(Reporting by Marc Jones, editing by Alun John)
Key Takeaways
- •S&P Global sees UK's borrowing cost rise as a concern.
- •Current situation doesn't affect UK's AA credit rating.
- •UK's fiscal position is constrained but manageable.
- •Interest expenditure volatility is highlighted.
- •100 basis point rise affects GDP by 0.4-0.5%.
Frequently Asked Questions about S&P calls UK borrowing cost jump a "concern", but no immediate hit to rating
1What is the main topic?
The main topic is the rise in UK borrowing costs and its impact on the country's credit rating as assessed by S&P Global.
2How does the borrowing cost affect the UK?
A 100 basis point rise in borrowing costs increases interest payments by 0.4-0.5% of GDP over a year.
3What is S&P Global's current outlook on the UK?
S&P Global maintains a stable outlook on the UK's AA credit rating despite concerns over borrowing costs.
